TORONTO, June 7, 2013 /CNW/ - Labrador Iron Mines Holdings Limited ("LIM" or the "Company") (TSX: LIM) is pleased to announce its first shipment of iron ore for 2013. The JK Pioneer, a Cape-size vessel carrying 174,360 wet metric tonnes of LIM iron ore, has sailed from the Port of Sept-Îles, bound for China.
LIM's first shipment consisted of sinter fines largely comprised of stockpiled material at the mine site and some port inventory, at a planned average grade of about 58% iron ("Fe"). Subsequent shipments during 2013 will be sinter fines and lump ore at a planned average grade of approximately 62% Fe. These shipments will consist of iron ore from the James Mine, made up of a mixture of higher grade dry screened ore and lower grade material that will be upgraded at the Silver Yards wet processing plant. Total saleable iron ore production in 2013 is expected to be between 1.75 to 2.0 million tonnes.
In May 2013, LIM signed a new two-year iron ore sales agreement with the Iron Ore Company of Canada ("IOC") for the sale of all of LIM's iron ore production for the next two calendar years 2013 and 2014. IOC has entered into an iron ore off-take agreement with RB Metalloyd Limited ("RBM") under which RBM has agreed to buy LIM's iron ore from IOC on a FOB Sept-Îles basis. Under LIM's new sales agreement, IOC will pay for the iron ore progressively, as the ore is resold, with the price calculation based on the monthly average of the market index, adjusted for product quality specification, premiums or penalties and after ocean freight and IOC's price participation.
The Silver Yards wet processing plant has restarted for the 2013 year and includes the Phase 3 upgrade and expansion which is now being commissioned. The wet plant will ramp up to its design capacity by the end of June and will operate in conjunction with the dry plant, which has been processing iron ore since April.
John Kearney, Chairman and Chief Executive of Labrador Iron Mines, stated "We are happy to report that LIM's first shipment of 2013 has sailed and that production is ramping up largely on schedule, despite difficult weather conditions that prevailed in the Schefferville area during April and May. Now that the Silver Yards wet plant is operating, we expect to accelerate our production, railing and shipping and look forward to a solid year of operations."
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